OPINION: HUD action could eliminate full-time RVing

The RV and manufactured housing industries have been battling for years over the definition of a “recreation vehicle.” Today, the federal government jumped in with both feet to propose a new rule that could end the lifestyle for a million people who use RVs full-time to live, work and play.

The manufactured housing industry has been extremely jealous of the RV industry for a long time because RVs don’t have to be built to the same hyper-regulatory and expensive requirements as sticks-and-bricks homes. RVs, after all, are homes on wheels.

Manufactured homes are also built on frames with wheels. But, rather than seeking to exempt those homes from the same building requirements as traditional dig-a-hole-in-the-ground-and-erect-a-foundation homes, the MH industry whines that RVs should be built to the same standards as a three-story, tri-level home.

The RV industry has avoided HUD regulation for years by winking and claiming that recreation vehicles aren’t really designed for full-time use, but rather as places for people to live and sleep for a long weekend or a week or two of summer travel. You know, like when they’re recreating.

So, today, the federal government formalized that notion. The RV and MH industries bought into that and consumers are supposed to buy it, too.

But, the industry has also spent $100 million to promote RVs as “freedom” vehicles in that people can take their homes-on-wheels virtually anywhere. For generations, the RV industry has sold the dream of retiring and traveling all over the country to explore new cultures, historical sites and seeing everything America has to offer.

Here’s the rub. It’s impossible to “see America” unless you’re living in an RV full time.

For the RV industry to agree that a notice must be prominently displayed in every RV offered for sale stating “this unit is designed only for recreational use, and not as a primary residence or permanent dwelling,” is, when you think about it, an incredibly silly thing to say.

Does that rule apply to RVs sold by private owners? Will regulators see it that way?

How much time do people have to spend in an RV for it to be considered a “primary residence?” Because, without a sticks-and-bricks home to return to, full-time RVers consider their motorhome or fifth wheel to be their “primary residence.” There has to be a magical line somewhere that people cross.

If people use an RV all day, every day for a year, does it become their “primary residence?” What if they live in the vehicle all day, every day for just six months? That’s still using an RV full time during that period, which makes it the primary residence, doesn’t it? What about using it all day, every day for 90 days?

Can we get the RV Industry Association and the federal government to agree on a definition of “primary residence?” Because, without it, the RV industry has just inadvertently thrust a knife into the heart of the RV dream.

How so? Right now, thanks to some ridiculous banking regulations, it is almost impossible for full-time RVers to get a loan to finance the purchase of a recreation vehicle. Government regulations require that people getting loans for such purchases must have a permanent address. This new agreement reinforces that line of thinking.

So, if you are buying a living room, bedroom, bathroom and kitchen on wheels, banking rules require that the borrowers also have a living room, bedroom, bathroom and kitchen secured firmly to the ground before they can get a loan. No wonder bureaucrats want to legalize marijuana.

That rationale means people looking to travel the country full time must lie to bankers about the purpose of the loan.

“Yes, sir, we are only going to use this RV to visit the Jellystone Park up the road a few times a year. No, sir, we would never dream of living it in full-time. It’s way too small for us to do that. Can we have a loan, please?”

More importantly, saying an RV can’t be used as a “permanent residence” suggests that there is a planned obsolescence to the RV. Some argue that RVs are already intentionally built to be used a maximum of 500 nights before they’re trashed. The construction quality and service frequency of some brands lend credence to that claim.

Now, thanks to the proposed rule being adopted in cooperation with the RV industry, manufactured housing industry and the U.S. Department of Housing and Urban Development, banks are specifically being told that an RV is not designed for extended living.

Does that mean consumers will soon face additional scrutiny when applying for a $200,000 loan — which is more than the cost of a good size home in much of the country — to buy a vehicle in order to enjoy a comfortable home while they “see America?”

When the industry tells the world that its products are designed only for recreational use, and not as a primary residence or permanent dwelling,” it signals that there is a problem with the vehicles being sold.

Why can’t they be used as a “primary residence?” Is there a safety issue? Or a product quality issue?

A catalyst for discrimination

Perhaps interpreting this new rule comes down to necessity of use. Does a family living in an RV full time because they can’t afford a house or an apartment equate to a different situation than grandpa and grandma living in an RV full time as they tour the country “recreating” for a few years while looking for the ideal place to settle down?

Maybe it matters if the vehicle moves. So, living in an RV parked at the same spot for three years makes it a “permanent residence,” but living in the same RV for three years and moving to a different state every month is considered recreational use.

Chances are the industry would embrace one type of family and shun the other.

This whole issue puts the industry in a tough spot because RVers already battle the perception of being “trailer trash” and nobody likes to see RV parks overrun by dilapidated vehicles that haven’t moved in years. But, RV parks are also full of wholesome, fun-loving people of all ages with money to support themselves and keep their “recreation vehicles” in tip top condition as their permanent residence.

There are plenty of legitimate reasons as to why people would want to live and work in an RV full time. Here are a few:

Highway construction workers or pipeline builders who must move to different locations every few weeks.

Sales professionals moving from one show to another who don’t want to lug suitcases into a hotel every night.

Journalists who travel the country reporting on the activities of various businesses within their industries.

Parents who think it is better to teach kids about history and other cultures by experiencing it directly rather than watching a video in a crowded classroom.

Missionaries or disaster relief workers who deliver needed supplies or assistance to distressed people and communities.

Or, my favorite, people who think it’s really nobody’s @#$%& business where they chose to live or how they chose to work.

Now that government has an official definition of a recreation vehicle as being “a unit designed only for recreational use, and not as a primary residence or permanent dwelling,” it will be interesting to see what other state and federal regulators jump all over it.

This new definition waves a red flag in front of power hungry bureaucrats to heap more unnecessary regulation on companies supporting the RV lifestyle and people living the RV dream. For example:

Must RV parks reject guests without a permanent residence to avoid “trailer trash?”

Will service centers be told they can’t fix RVs unless the customer has a permanent residence? Otherwise the customer is using the vehicle in a way that was not intended by the manufacturer. Think of the warranty claims that could be denied on rationale that alone!

Will parents be told they can no longer homeschool kids in an RV because the vehicles aren’t safe as a primary residence? But, those same vehicles are safe enough to use for week-long vacations.

Oh, what a tangled web we weave when trying to appease the insatiable appetites of career bureaucrats.

Perhaps there is a silver lining in all this nonsense. Maybe a whole new industry will crop up to create mobile “permanent residences” that are built tougher, and will last longer without breaking down every couple of months.

Instead of being designed to sleep a dozen people for a maximum of 20 days a year, they’ll be built to support the lifestyle of two or four people wherever they go for as long as they want to travel.

The only problem is that some other bureaucrat will probably rule those families won’t be allowed to use the homes for “recreation” because that’s not how they were designed to be used.

In support of my assertions, the best place to look is the actual proposed language of the rule itself and accompanying text, which can be viewed here: http://portal.hud.gov/hudportal/documents/huddoc?id=frnotice2916.pdf
It clearly states that these are the proposed regulations which are subject to public comment through April 11, 2016. Reading the history of the rule also shows that the general thrust of the decades-long process has been, and continues to be, for the exclusion of RVs from the stricter HUD guidelines imposed on manufactured homes. The plain language of the proposed rule itself is that recreational vehicles are excluded from HUD manufactured home regulations, period. The sticking point becomes how to define “recreational vehicle” but the clear intent of the rule is to exclude RVs, and any court or administrative body subsequently seeking to interpret this rule would start with, and give extreme prejudice to, the stated purpose of the rule, which is to exempt RVs from HUD regulation.

As for the lengthy discussion about financing an RV for full-time residence, that’s an interesting discussion and it’s a real problem for RV purchasers, but it has NOTHING to do with the new HUD rules. Why HUD is even involved here is that HUD oversees implementation of the Fair Housing Act and sets the rules and policies for all FHA and VA loan programs, among others. Mortgage lenders (generally) only make loans that comply with the promulgated rules under these programs because that means that the loans are federally guaranteed. Recreational vehicles are not, and have never been, acceptable collateral under any of these federally insured loan programs. The idea behind these programs is to encourage home ownership in economically appreciable property, and with limited exceptions, in the eyes of the fed that means a home that comes with an interest in real estate. Because mobile homes do NOT necessarily come with a permanent interest in real property, they fall into a category of “other” (along with condominiums, e.g.) that require compliance with additional regulations in order for loans made on that dwelling to be federally insurable. The web portal for HUD guidelines on manufactured homes can be found here: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/ramh/mhs/faq

What’s at stake here is the way those HUD manufactured home regulations exclude RVs and the definition used in that exclusion. The vast, vast majority of RVs are clearly excluded from HUD regulation because they don’t have any permanent or semi-permanent foundation (the guidelines for mobile home foundation requirements can be found here: https://www.huduser.gov/portal/publications/destech/permfound.html). So it’s a no-brainer that nearly all RVs are (1) excluded from HUD regulation of manufactured and mobile homes, and (2) ineligible for any loan programs administered by HUD and guaranteed by the federal government.

What’s really at stake here is a small number of park model RVs that arguably are intended for use as a permanent residence, have some form of foundation, and exceed the existing parameters for a mobile home (e.g., size in excess of 400 sq. ft.) such that they could POTENTIALLY have been subject to HUD regulation under the existing rules. The new rule is an attempt by HUD and the manufactured home and RV industries to make sure that the rules as written clearly exempt RVs from HUD regulations. That’s all. In the broader picture, that’s totally fair considering that the RV as a “dwelling” does not also enjoy the benefit of being collateral eligible for any HUD-administered loan programs. RV owners don’t get the burden of compliance with HUD regulations and we don’t get the benefit of federally-secured financing. That makes sense. That’s what is happening here.

So let’s back up to Mr. Gerber’s headline: “HUD Action Could Eliminate Full Time RVing”. Seriously? I’m not going to dispute or support every items discussed in the piece, but given the scope and impact of the proposed changes, that’s an exaggeration to say the very least. Yes, there’s a wink-wink nudge-nudge aspect to full timing that can be a pain in the ass, and we do have difficulty getting financing, run the risk of voiding warranties and myriad other issues by choosing to live full-time in a vehicle built for part-time occupancy, but all of those burdens are thrust upon us by private banks, sketchy warranty companies and shoddy manufacturers. None of that can be blamed on the federal government. All they’re trying to do with this rule is keep RVs OUT of the tangled mess of HUD bureaucracy. The article, even while an opinion piece, could have done a lot more to address those issues without conflating them with an action by the federal government that bears no relation to the complaints floated here.

To the contrary, I’m a lawyer in private practice that frequently has to work with bureaucrats — HUD in particular. Even if I was a bureaucrat, which I assume you meant as an insult, it wouldn’t change the facts as stated.

Well said Steven on both accounts. Thanks for dissecting the legality and framework of this proposal. I didn’t realize financing and warranties were such a burden for RV owners trekking full-time. We are part-time full-timing homeschoolers which I guess falls under “wink-wink nudge-nudge”. Our travels are educational field trips on steroids.

Oh, what a tangled web we weave when trying to appease those that wish to deceive us. BTW, I live in a 35′ Travel Trailer, have been since 11/2104. It really is the only place I can afford, here in NJ. I stay here for work and family is close.

I think there aremany good points here. read between the lines type of thing. I could definetly see much fallout over this, since we started rv’ing in 2010 things have shifted considerably in the Rv travel world. We bought a truck camper and renovated it in 2010. we were done by 2011.

we rv’ed for 5 months and then went back into a sticks and bricks rental. This sucked and was just filled with problems, plus it sucked us dry of nearly all our monthly income, all of it. we to a more affordable place and then our landlord got forclosed on by land lease taxes that went from 100$ mo to 1000$ mo overnight. We visited a local RV dealer, several actually to look at a larger more accomodating unit. we apped but were told we needed to raise our credit up and we could get a loan, no cosigner needed. And being a renter was fine.

So, we moved back into our truck camper, and headed to my families 4 states away to park.

when we got there we took our last 2000$ and bought a stop gap 5th wheel to full time in until we could get our credit up high enough to get a Dedicated FullTimer Unit. We hit our mark by Aug 2013, but by this time now we must also own a home in addition to our now achived 800 credit score. I was crushed

So, back to the drawing board.

May 2015 we bought our Now FullTime Unit. A high end 2004 Fleewood FullTimers Unit built before the crash, and one that had been warrantied for Full Time Use when it was built, complete with user guide for Permanent Occupancy and what to do to care for the rig. We bought it for 16K and put it all on a credit card. payments are fine and it has no lein on the title. No, we couldnt get the 60K unit we were after (Evergreen Bayhill Bunk House wiht split level bedroom) and use a credit card, but this worked out fine.

Its like this though,

exactly to what extent, do they really get to call the shots on what we will and will not do with our own residential needs and wants. We rented our whole lives, and at no time during our rental history was it ever satisfactory, and for nearly 1000$ mo it should be the kings palace and everything should work, but you know what it never worked that way. We just had to keep shoveling and after rent the exorbant utilities, and after that we couldnt even buy milk. we were at the food bank line begging for food because out rental expenses were so high we had nothing left.

Since we went full time, all our bills are paid, we eat all organic diet, i have been able to buy really high end appliances and upgrades for our rig, we have been able to afford just about anything we need with a few hundreed to spare. We have been able to all have our own computers and have converted to all apple and bought all the applecare warranties which have served us well. Our quality of life is 180 degrees what it was our entire adult lives scrubbing at the mercy of one landlord to another and never having a dime left.

Now our money goes back into us, we no longer just fly it away to the unknown machine known as the houseing industry. I dont think its meant for anyone to ever get ahead-ever.

And a Mortgague? what a joke, like we would ever even own it. no one ever does. they just pay their mortgauge until they cant anymore and then they short sell or sell or get forclosed on, and then they still need to find somewhere to live and now are at the mercy of the landlords themselves.
You dont own a house this day and age, you act like you are buying one, but really you are a glorified renter with a title that says you can sell if you no longer can make payment.

If they can take it. You dont own it. period.

Now , I assume since so many people have converted, now its cutting into their rental profit and thier mortgauge profits. Also, they cant own you in a situation where you really own your own destiny, so I think it is a collection of things that is the driving force behind all this mish mash hogwash HUD Rules.

We will just buy ourselves some land somewhere now, outside of any property covenants or local codes that restrict raw land use, we still wont be going sticks and bricks. it wont happen again, now we know how good it is to be on the other side, there is absolutely no incentive to starve again just to say “look we are normal we live in a stick and brick” when on the inside our fridge has not one thing to consume.

its really a matter of choices that depict ones own survival in this world we live in. If you dont see it coming you may end up on the tracks getting plowed down by the train, but if you have enough foresight to negotiate probability you may just come out ok.

God Bless ladies like Sally. You should write a book and expand this letter because, in brief form, you have told it like it really is. Keeping up with the Jones is, was and will continue to be A FARCE.

The idea of HUD even being mentioned concerning this is funny. They are the reason I live on the road. Being disabled, dealing with four massive floods in fours years, the fifth year a hot water pipe exploded and ruin everything I owned. Replaced everything the next year with $17,000 of my disability money only to find out the entire place and every apartment complex in the area was infested with bed bugs. I lost everything. Go ahead and try to let them have a say in anything in my life!

Lynn has the best respons of them all..
sometimes it’s as simple as that. Personal preference. These laws overcomplicate a very simple matter.. The choice to live your life as you see fit so long as your lifestyle isn’t negatively affecting anyone else.
what happened to freedom?
The fact is, people have been doing the fulltime RV thing for generations and only now, when there’s money at stake, are people getting up in arms and trying to regulate the bejeezus out of it in the name of “safety.”
I still can’t see what the point of the proposed legislation is or how it ensures anyone’s safety. Again, people have been living in RVs for years with no problem. Mainly because up until now with home ownership now out of reach for most working class people, there have been more people seeking out lower cost alternatives. RVs and tiny homes are now getting a large enough chunk of the housing dollar to make other industries sit up and take notice of the money they’re now losing to alternative lower cost housing.
The I think Greg is absolutely right. These propopsed laws have nothing to do with the best interest of the people and more to do with the best interest of the conventional housing market.
Last thing home builders, buyers and renters want to see is some smart ass RVer enjoying their own home minus all the bills their homeowning and renting counterparts are saddled with. Simple as that.

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